Discussion Papers 569, 21 S.
Marco Caliendo, Katharina Wrohlich
2006. Mar.
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Published in: Applied Economics 42(2009) Iss. 19, 2475-2489
Increasing work incentives for people with low incomes is a common topic in the policy debate across European countries. The "Mini-Job" reform in Germany - introduced on April 1, 2003 - can be seen in line with these policies, exempting labour income below a certain threshold from taxes and employees' social security contributions. We carry out an ex-post evaluation to identify the short-run effects of this reform. Our identification strategy uses an exogenous variation in the interview months in the German Socio-Economic Panel, that allows us to distinguish groups that are (or are not) affected by the reform. To account for seasonal effects we additionally use a difference-in-differences strategy. The results show that the short-run effects of the reform are limited. We find no significant short-run effects for marginal employment. However, there is evidence that single men who are already employed react immediately and increase secondary job holding.
Topics: Labor and employment
JEL-Classification: C25;H31;J68
Keywords: Evaluation, natural experiment, difference-in-differences, marginal employment
Frei zugängliche Version: (econstor)
http://hdl.handle.net/10419/18462